U.S. Bureau of Labor Statistics

Occupational Employment Statistics

Technical Notes for 2001 OES Estimates

Scope of the survey

The Occupational Employment Statistics (OES) survey is an annual mail survey measuring occupational employment and wage rates for wage and salary workers in nonfarm establishments, by industry. The OES survey samples and contacts approximately 400,000 establishments each year and, over 3 years, contacts approximately 1.2 million establishments. The reference period for each year's survey is the fourth quarter of that year. The nationwide response rate for the 2001 survey was 78 percent for establishment units and 71 percent for employment. While estimates can be made from a single year or 2 years of data, achieving the desired precision for OES survey estimates requires the full 3 years of sample. (See Estimation Methodology section.) The full sample allows the production of estimates at fine levels of geographical, industrial, and occupational detail. Estimates from the 2001 survey are based on data collected from establishments for 1999, 2000, and 2001 using the Standard Occupational Classification (SOC) system. A brief description of this classification system is provided below.

The Occupational Classification Standard for 2001 In 1999, the OES survey began using the Office of Management and Budget's occupational classification system—the Standard Occupational Classification system (SOC). The SOC system is the first OMB-required occupational classification system for federal agencies. The OES survey categorizes workers in one of about 770 detailed occupations. Together, these detailed occupations comprise 22 major occupational groups. The major groups of the SOC system are as follows:

BLS funds the survey and provides the procedures and technical support, while the State Employment Security Agencies (SESAs) collect the data. BLS produces cross industry and 2- and 3-digit Standard Industrial Classification (SIC) industry estimates for the nation, states, and metropolitan statistical areas (MSAs). BLS releases all cross industry and national estimates, and the SESAs release industry estimates at the state and MSA levels.

The OES survey defines employment as the number of workers who can be classified as full-time or part-time employees, including workers on paid vacations or other types of leave; workers on unpaid short-term absences; salaried officers, executives, and staff members of incorporated firms; employees temporarily assigned to other units; and employees for whom the reporting unit is their permanent duty station regardless of whether that unit prepares their paycheck. The survey excludes the self employed, owners/partners of unincorporated firms, and unpaid family workers. Employees are reported in the occupation in which they are working, not necessarily for which they were trained.

The OES survey currently uses the Standard Industrial Classification system to classify all establishments. An establishment is defined as an economic unit that processes goods or provides services, such as a factory, mine, or store. The establishment is generally at a single physical location and is engaged primarily in one type of economic activity. The scope of the survey includes establishments in SIC codes 07, 10, 12 to 17, 20 to 42, 44 to 65, 67, 70, 72, 73, 75, 76, 78 to 84, 86, 87, and 89 and state and local government. This scope covers agricultural services; mining; construction; manufacturing; transportation and public utilities; wholesale and retail trade; finance, insurance, and real estate; services; and government workers. Data for the Postal Service (SIC code 43) and federal government are universe counts obtained from the Postal Service and the Office of Personnel Management, respectively. Beginning with the 2002 estimates, the OES survey will be using the North American Industry Classification System as the basis for industry classification.

States' Unemployment Insurance (UI) files provide the universe from which the OES survey draws its sample. The employment benchmarks are obtained from reports submitted by employers to the UI program. In some nonmanufacturing industries, supplemental sources are used for establishments not reporting to the UI program. The OES survey sample is stratified by area, industry, and size class. Size classes are defined as follows:

Size class

Number of employees

1

1 to 4

2

5 to 9

3

10 to 19

4

20 to 49

5

50 to 99

6

100 to 249

7

250 and above

UI reporting units with 250 or more employees are sampled with virtual certainty across a 3-year period. Generally, one-third of the certainty units are sampled each year in each state. There are some states that sample more than one-third of their certainty units during one survey year.

Concepts

Employment is the estimate of total wage and salary employment in an occupation across the industries in which it was reported. The OES survey form sent to an establishment contains between 50 and 225 SOC occupations selected on the basis of the industry classification and size class of the sampled establishments. To reduce paperwork and respondent burden, no survey form contains every SOC occupation. Thus, data for specific occupations are collected primarily from establishments within industries that are the predominant employers of labor in these occupations. Each survey form is structured, however, to allow a respondent to provide information for each detailed occupation employed at the establishment; that is, unlisted occupations can be added to the survey form.

The OES survey collects wage data in 12 intervals. Employers report the number of employees in an occupation per each wage range. The wage intervals used for the 2001 survey are as follows:

Interval

Hourly Wages

Annual Wages

Range A

Under $6.75

Under $14,040

Range B

$6.75 to $8.49

$14,040 to $17,679

Range C

$8.50 to $10.74

$17,680 to $22,359

Range D

$10.75 to $13.49

$22,360 to $28,079

Range E

$13.50 to $16.99

$28,080 to $35,359

Range F

$17.00 to $21.49

$35,360 to $44,719

Range G

$21.50 to $27.24

$44,720 to $56,679

Range H

$27.25 to $34.49

$56,680 to $71,759

Range I

$34.50 to $43.74

$71,760 to $90,999

Range J

$43.75 to $55.49

$91,000 to $115,439

Range K

$55.50 to $69.99

$115,440 to $145,599

Range L

$70.00 and over

$145,600 and over

Mean wage is the estimated total wages for an occupation divided by its weighted survey employment. With the exception of the upper open-ended wage interval, interval L ($70.00 an hour and over), a mean wage value is calculated for each wage interval based on occupational wage data collected by the BLS Office of Compensation and Working Conditions. The mean wage value for the upper open-ended wage interval is its lower bound (Winsorized mean). These interval mean wage values are then attributed to all workers reported in the interval. For each occupation, total weighted wages in each interval are summed across all intervals and divided by the occupation's weighted survey employment.

Annual wage. Many employees are paid at an hourly rate by their employers and may work less than or more than 40 hours per week. The annual wage estimates in this release are calculated by multiplying the mean hourly wage by a "year-round, full-time" hours figure of 2,080 hours per year (52 weeks by 40 hours). Thus, the annual wage estimates may not represent the actual annual pay received by the employee if they work more or less than 2,080 hours per year. There are workers in some occupations who are paid based on an annual amount, but generally do not work the usual 2,080 hours per year. Since the survey does not collect the actual hours worked, the hourly rate cannot be calculated with a reasonable degree of confidence from the annual wages. For this reason, the annual salary is directly calculated from reported survey data and only annual wage estimates are reported for these occupations. Occupations that typically have a work year of less than 2,080 hours include musical and entertainment occupations, pilots and flight attendants, and teachers.

Hourly versus annual wage reporting. For each occupation, respondents are asked to report the number of employees paid within specific wage intervals. The intervals are defined both as hourly rates and the corresponding annual rates, where the annual rates are constructed by multiplying the hourly wage rate for the interval by the typical work year of 2,080 hours. In reporting, the respondent can reference either the hourly or the annual rate, but is instructed to report the hourly rate for part-time workers.

Estimation methodology

The OES survey samples approximately 400,000 establishments each year and, over a 3-year period, contacts approximately 1.2 million establishments. Each single-year sample represents a one-third sample of both the certainty and non-certainty strata for the full 3-year sample plan. While estimates can be made from a single year or 2 years of data, the OES survey has been designed to produce estimates with a desired precision using the full 3 years of data. The full 3-year sample allows the production of estimates at fine levels of geographical, industrial, and occupational detail. Producing estimates using the 3 years of sample data provides significant sampling error reductions (particularly for small geographic areas and occupations); however, it also has some quality limitations in that it requires the adjustment of earlier years' data to the current reference period—a procedure referred to as "wage updating."

Wage Updating. As noted above, combining multiple years of data has both statistical advantages and limitations. Significant reductions in sampling error can be achieved by taking advantage of 3 years of data, which covers over 70 percent of the employment in the United States. This feature is particularly important in improving the reliability of estimates for small domains in the population (that is, wage and employment estimates for detailed occupations in small areas). Combining multiple years of data also has been necessary to obtain full coverage of the certainty strata (that is, large employers with 250 or more employment).

Starting with the 1997 estimates, the OES program has used the over-the-year fourth-quarter wage changes from the Bureau's Employment Cost Index (ECI) to adjust prior year survey data before combining it with the current year data. The wage updating procedure assumes that each occupation's wage, as measured in the earlier years, moves according to the average movement of its occupational division and that there are no major geographic or detailed occupational differences—and this may not be the case. The Bureau has conducted research over the past several years on the accuracy of the ECI wage-updating method versus other modeling approaches. Current research results support the continued use of the ECI wage-updating methodology.

2001 OES survey estimates. The 2001 OES survey estimates are based on data collected from establishments for 1999, 2000, and 2001. The 2001 estimates use the wage-updating methodology introduced in 1997, which uses the over-the-year fourth-quarter wage changes from the Employment Cost Index to adjust prior years' data before combining them with data from the current year. In addition, the 2001 estimates use the estimation methodology introduced in 1997, which uses a "nearest neighbor" imputation approach for nonrespondents and applies employment benchmarks at a detailed MSA by 3-digit industry and broad size class level.

Reliability of the estimates. Statistics based on establishment surveys are subject to both sampling and nonsampling error. When a sample of the population is surveyed, there is a chance that the sample estimate of a characteristic may differ from the population value of that characteristic. The difference between the sample estimate and the population value will vary depending on the particular sample selected. This variability is measured by the sampling error (SE). If we were to repeat the sampling and estimation process using the same survey design, 90 percent of the intervals from the sample estimate minus 1.6 SE to the sample estimate plus 1.6 SE would include the population value. This interval is called a 90-percent confidence interval. The OES survey produces estimates of the relative standard error (RSE). The RSE is defined as the SE divided by the estimated value as computed from the sample. This statistic provides the user with a measure of the relative precision of the sample estimates. The SE may be obtained by multiplying the RSE by the sample estimate. RSE estimates are produced for both occupational employment and mean wage estimates. The employment RSE values are estimated using a subsample replication technique known as the Jackknife (random group) variance estimation method. The mean wage RSE values are estimated using a variance components model that accounts for both the observed and unobserved components of the wage data. The variances of the unobserved components of the wage data are calculated from the Bureau's National Compensation Survey. In general, estimates involving many establishments have lower relative standard errors than estimates involving few establishments. If the distributional assumptions of the models are violated, the resulting confidence interval may not reflect the prescribed level of confidence.

Additional information

The 2001 OES national data by occupation, comparable to data in table 1, will be available soon on the Internet (http://www.bls.gov/oes/). Users also may access each occupation's definition and percentile wages. The 2001 cross industry data for states and metropolitan areas will be available on the BLS Web site in late November. Industry staffing patterns at the 2- and 3-digit SIC levels also will be available from the Internet beginning in late November. These data will include industry-specific occupational employment and wage data. BLS also plans to release a bulletin displaying 2001 occupational employment and wage data for selected industries and areas in the spring of 2003.